Nigerian govt to issue full operating license to Dangote Refinery

Nigeria’s domestic refining landscape is set for a significant shift with the imminent issuance of a full operating license to the Dangote Petroleum Refinery.

This was made known by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), during a stakeholders’ forum, on Tuesday.

While the Dangote Refinery, boasting a massive 650,000 barrels per day capacity, was inaugurated by President Muhammadu Buhari in May 2023, it was operating under a pre-commissioning license. This latest development suggests the refinery has met the regulatory requirements for full operation.

The NMDPRA’s Chief Executive, Farouk Ahmed, acknowledged that only three refineries currently hold valid operating licenses in Nigeria. Issuing a license to Dangote, even during pre-commissioning, signifies the government’s confidence in the project’s progress.

Ahmed, who was represented by the Executive Director, Distribution Systems, Storage and Retailing Infrastructure, NMDPRA, Ogbugo Ukoha, pointed out that currently, only three refineries have valid licences.

“We have issued three refineries with three valid licences. We awarded to Dangote refinery even in their pre-commissioning and sooner than later they will have full commission and a valid licence to also operate,” he stated.

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He also stated that about 15 gas facilities across the country have valid licences while more are undergoing processing.

The NMDPRA boss said there are 1,199 facilities with valid licences in the downstream, while more than 176 operators hold gas import permits.

Ahmed said 130 depots have valid licences while 69 hold valid coastal vessel licences, adding that NMDPRA has licensed 9,464 retail outlets as of 10 am on April 30, 2024.

“In the gas processing facility within the midstream, there are about 15 of them with valid licences. And much is under processing. If you go to the downstream sector, in the gas state of the downstream, more than 1,199 facilities have NMDPRA valid licences.

“More than 176 operators hold gas import permits. In the liquid licensing side of the downstream, there are 130 depots with valid licences and coastal vessels of more than 69 valid licences as of today. And in the retail outlets, we have 9,464 licensed retail outlets as of 10 am today, April 30,” Ahmed stated.

Analysts point to the refinery’s recent production of Automotive Gas Oil (diesel) for the domestic market in April 2024 as a key milestone. This initial production likely played a role in the NMDPRA’s decision to expedite the full operating license.

The Dangote Refinery’s full operation has the potential to significantly impact Nigeria’s fuel imports and could lead to a more stable supply of petroleum products domestically. Experts predict a potential reduction in reliance on foreign refined fuels, potentially leading to lower costs at the pump for consumers.

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